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What the Google-Facebook Battle Is Really About May 16, 2011

Posted by David Card in Uncategorized.
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Facebook’s silly scheme to plant anti-Google privacy stories further highlights the bitter rivalry between the two companies, but it also points at what they’re really fighting over. The competition is not so much about each company’s core business — search vs. advertising-powered social networking — as it is about future products and services, and each company’s respective role as a technology platform provider. And potential partners and competitors need to know which battles these two competitors will take seriously so they can adjust their own priorities and investments.

Here are the key areas of competition for Facebook and Google:

  • The “interest graph:” In contrast to a social graph of information about relationships between people, an interest graph based on topics might actually be a better indicator of purchase intent than what friends — who may not have similar tastes — like. Facebook Likes and Google search results feed such a graph — though Twitter may have more easily collectible info here than either.
  • Web navigation: Facebook hasn’t proven it can drive shoppers to commerce sites the way Google can, but it’s becoming an important source of visitors to online media sites like the New York Times, CNN and HuffPo. Consumer platforms depend on habitual use, so Google can’t risk losing ground as an overall web-discovery vehicle.
  • Communications: It’s unlikely social media will completely replace email, but both Google and Facebook are competing to be a user’s unified communications hub by integrating mail, chat and posts with contact lists and presence management. Such a hub would generate constant use and potential customer lock-in, and be a rich source of contact data.
  • Identity management/authentication: Facebook tries to enforce a single, authentic user identity, but it isn’t very good at letting that user manage his relationships between different types of friends or groups. Google does offer a sign-on service, but its Profiles are mostly for search personalization. Authenticated identities could play a big role in payments systems and professional/career relationships.
  • Ad networks: Google ad networks dominate search and are strong in direct-marketing display. In theory, Facebook’s Like network could serve context- and behavior-based advertising on sites web-wide. Facebook’s complaint that Google scrapes social information without explicit permission might be based on potential privacy legislation. One bill under consideration would give companies with formal consumer relationships more freedom to use data for advertising. That would give a company like Facebook an advantage over third-party ad networks.

Build, Buy or License?

Facebook doesn’t seem interested in building a conventional search engine, but Google sure is trying to build out some Facebook-like technologies. Google recently introduced +1, a competitor to Facebook Likes, where users recommend search results, ads and, eventually, web pages. Website owners will no doubt flock to +1 for its potential influence on Google search ranking. But, faced with yet another link-sharing option, users may ignore +1, especially since Google lacks an established equivalent of Facebook’s news feed to display links.

Neither company likes to license technology or data from other companies, with the exception of Facebook’s Microsoft partnership. Google seems to have some arrangement with Facebook that gives it access to Facebook company Pages, but the two have long bickered over sharing contact information.

Since they don’t like partnerships, how about acquisitions? Business Insider has a laundry list for Google, but two are big and might also appeal to Facebook:

  • Twitter: Either company’s ad business could instantly monetize Twitter better than Twitter can itself. But neither may need to buy into Twitter, as it seems pretty easy to get access to Twitter data.
  • LinkedIn: The professional social network is stingier about sharing data, has a working business model and could play an important role in identity authentication. But it’s about to go public, so would-be acquirers would have to act fast.

Question of the week

What are Facebook and Google really fighting over?
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The Battle for Unified Communications Heats Up March 7, 2011

Posted by David Card in Uncategorized.
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Synchronous communications like mobile group chat are the latest battleground in the war over unified communications. Startups like GroupMe and Yobongo were part of a flurry of announcements last week on IM, chat and group messaging, but no matter how clever and fun their apps are, and no matter how much these companies hope to be the stars of this year’s SXSW conference, they’re not the real contenders in the race to create a unified communications hub.

Rather, the battle for what company supplies a user’s communications control panel is being fought among technology platform players like Google, Microsoft and Facebook. And a scrappy Skype can’t be ignored either.

The winners — and there’s enough interoperability across communications channels to accommodate multiple hubs — will have an application that its users access constantly. A unified communications hub offers potential customer lock-in through habit and the effort required to switch. Om wrote that by controlling a user’s synchronous interactions — sharing experiences that replicate reality — Google could fix its social media flops and beat Facebook. A unified communications hub could be the launchpad to do just that.

Building the Unified Communications Hub

A successful communications control panel will integrate three key components:

  • Universal communications channels: A user should be able to manage both real-time and asynchronous communications, one to one and multi-party, and across different channels: voice, email, text, video. Managing means initiating or receiving the message and moving gracefully between channels with as little effort as possible. For example, IMs should convert to SMS messages if the receiver is away from his computer or smartphone. Email and messaging from Google, Microsoft and Yahoo are good at this already.
  • Contact management: Besides just storing contacts and their various addresses, a universal communications hub increasingly needs to manage groups. It’s even better if that doesn’t require a user to work too hard. Facebook is attempting to get users to tag group members rather than make lists, and Google’s Gmail prioritization auto-sorts by “learning” from a user’s previous email activities. Location-based services and social graphs about a user’s relationships and preferences will play a big role here.
  • Presence management: People need better control over managing their availability. With chat and IM, you’re either available to all or not, and you have to manually screen your phone calls. By integrating contact groups and presence, a person could make himself available in real time for family in the evening, but available to co-workers only via email.

I’m less convinced about the need for a universal inbox, at least the way Facebook has implemented it. Yes, there should be one place to find notifications of communications waiting for you; Apple’s visual voice mail is a great example of this. But storing IMs and emails together, and sorting them only by user, seems oversimplified. Users likely appreciate the non-permanence of IMs and the flexibility of folders.

Handicapping the Contenders

So what are the contenders’ key strengths?

  • Google can lead with voice, mail and mobile. It should actively build hub features into Android, rather than depend on third-party apps.
  • Microsoft’s mail and IM strength is in corporate markets, and it gets along with Facebook on contact sharing. Nokia could be a strong partner in mobile hubs, but that’s going to take some time.
  • Facebook can leverage its social graph to create a hub that requires the least effort from users. It is gaining ground in synchronous communications and dominates link- and photo-sharing.
  • Skype has moved well beyond its original cheap calling pitch into an early lead in video, and already acts as a control panel for many consumer communications. It’s strengthening its enterprise position with web conferencing partner Citrix.

Question of the week

Who is leading the charge in unified communications?

What Facebook Messages Is Really After November 22, 2010

Posted by David Card in Uncategorized.
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It’s not email. That’s what Facebook CEO Mark Zuckerberg said at last week’s introduction of Facebook Messages. He called it “a modern messaging system,” and half-jokingly added that the next generation of users would gradually drift away from email. But what Facebook is really trying to establish with its unified communications hub is presence management, which is why Facebook Messages feels at least as much like IM as it does email.

Driven by enterprise-oriented companies like Microsoft, IBM/Lotus and later Google, email evolved with the addition of PIM features like contact management and calendar integration. Those companies, along with consumer-focused ones like Yahoo and AOL, added spam filtering and began to integrate other communication types and transports, including instant messaging and voice. At the same time, the corporate companies built up collaboration facilities, beginning in the ’80s with Lotus Notes, and more recently with services like Microsoft SharePoint and Google’s ill-fated Wave.

But Facebook is moving in a completely different direction.

Intimacy and Immediacy

Facebook Messages focuses on intimacy and immediacy at the expense of formality, flexibility and history. Yes, Facebook’s social inbox pulls in different message types, but it weaves them into a thread that’s based on the sender rather than the topic, similar to IM or texting on a smartphone. To encourage immediate and recurring use and response, Facebook Messages eliminates subject headers and address look-up. Inbox folders are Friends, Other and Junk. That’s it.

And the approach isn’t aimed at only consumer (rather than professional) usage. Rather, it de-emphasizes important consumer communications like billing, newsletters, one-to-many emailing and forwarding. That’s because it’s more important in the long run for Facebook to be its users’ launchpad for personal communications and presence management than it is for the feature to be the management tool for all communications.

The Real Objective: Presence Management

By presence management, I mean the tools and platform a person uses to announce his availability to other people (and, potentially, to ‘bots and services). A powerful, unified presence manager would also enable the user to express how he’d like to communicate, and to manipulate that “how” and “when” availability to different types of contacts. Early examples of presence management tools were AOL’s IM and chat (though Buddy Lists didn’t make that availability very flexible) and Caller ID. Today’s email and social network apps also contain such tools.

If Facebook establishes Messages as a user’s primary tool to manage presence across multiple communications vehicles, it would be an incredibly sticky app, with huge customer lock-in potential. Facebook contacts are beginning to play an increasingly important role across communications. That’s one reason Facebook doesn’t want users to share them. Facebook Groups could be a step towards a presence-aware buddy list. For instance, after 6 p.m. a user could make himself instantly available for family, but available to co-workers only via email.

How Should Competitors React?

Email’s not going away, for many reasons. Even teenagers want their online shopping receipts, and likely won’t route newsletters to their Friends inbox.

Microsoft understands this, and the difference between corporate and personal email. It should continue to build collaboration into Outlook, bridges between Outlook and Hotmail, and make sure its Messenger presence infrastructure interoperates with Facebook’s.

Gmail is an extensible apps platform, and a Gmail address is a hub domain for non-communications apps. Google’s aggressiveness in voice communications might give it an advantage over Facebook in mobile presence management.

Yahoo and AOL need to integrate voice communications deeply, and push hard to get their IM apps used on smartphones, with ties as strong as possible to SMS.

At one point, carriers like Verizon and AT&T looked like they could play a role in presence management, or establish their address book as a user’s most critical one. But they’ve built little off those bases.

Question of the week

How can companies compete with Facebook Messages?

Why Facebook “Groups” Matters October 11, 2010

Posted by David Card in Uncategorized.
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The digerati’s reaction to last week’s Facebook announcement was entirely too focused on privacy. That’s partly Facebook’s fault, as the company presented the three new offerings under the headline of returning control to the user. But one of those offerings, Facebook Groups, is less about keeping secrets than it is about making the Facebook experience more relevant, and thus valuable.

Groups is the big deal in this three-pronged announcement, even if its initial implementation is very basic. Facebook CEO Mark Zuckerberg called Groups a “fundamental building block of the social web” because it’s so much more like reality. The resulting blocks could have a big impact on communications and identity management, and on viral application and content distribution as well.

Can Facebook Jump-Start Groups Adoption?

Before Groups makes a big impact, people will first have to use it. I agree with Zuckerberg: Most people don’t want to interact in the exact same way with all 135 (or 250 or 1,000) of their “friends.” In the real world, individuals belong to multiple groups based on things like shared interests, geography and family; if Facebook users put their online friends in groups, more relevant communications and experiences are likely to result. This would increase Facebook’s value, and with that, its usage. That’s the theory anyway.

Prior to Groups, Facebook users organized their friends by creating lists. But only 5 percent of Facebook users make lists; most make only one, according to the social network. In contrast, the company says, while the majority of users don’t upload photos regularly, 95 percent have a photo of themselves that’s been tagged. The “power taggers” do most of the work. And while many of the tagged remain passive, the point is that they’re included in the dialogue. Facebook believes Groups will repeat this pattern, eventually leading to 80 percent coverage of users. That’s also why Groups invitations are opt-out — to the consternation of some — at least in the service’s initial implementation.

What Groups Is Really About

If Groups’ adoption becomes widespread, those aforementioned “building blocks” could generate powerful results inside and outside of Facebook. Groups are woven into the Graph API; apps can make use of Groups. And Facebook intends membership and interaction to be syndicate-able outside of Facebook, similar to its Like button or log-in.

So where could Groups make real waves?

  • Feed filtering and curation. Users will filter their Facebook news feed — that includes aggregated updates from Twitter, Foursquare, and others — by Groups. This could prove more efficient than using search or topical taxonomies. It could also give Facebook more advertising inventory that’s targetable by highly relevant information.
  • Identity management. Users will be able to engage in social media interactions in the appropriate contextual modes. Imagine Groups for shopping, entertainment recommendations, professional communications, etc. Groups could essentially offer federated authorization (among members) to different apps and services.
  • Unified communications and presence management. Groups could enable better presence management — you’re available only to after-work friends, for example — than we’ve seen in email or IM applications.
  • App interaction and distribution. Facebook recently changed its social gaming policies to better direct relevant updates to gamers instead of non-gamers. Similarly, Groups could filter and enhance social commerce and other applications.

Who Should Pay Attention?

Marketers can’t make Groups, just Pages. But don’t think Facebook won’t develop appealing promotions and targeting techniques for its own advertising platform. I doubt advertisers will ever be able to target individual Groups. The contextual information within the content of Groups, however, should produce topics and keywords that would be a very accurate representation of interest — catnip for advertisers.

Companies that provide content aggregation (Yahoo, Digg, Yelp) and/or real-time information streams (Twitter), or add value on top of those streams (Google, TweetDeck, Seesmic) may need to counter or support Groups. Otherwise they risk being just one less-useful and less-monetizeable feed in a Facebook viewer.

Facebook does not offer robust enough security or content/communication management features to threaten enterprise collaboration players like Microsoft, Salesforce.com, or Box.net. Lighter-weight services like Yammer should keep alert, though.

Related Research: Four Ways Facebook can Conquer Mobile

Question of the week

Where will Groups have the biggest impact?